Back-to-front: transatlantic reversal
Back-to-front: the transatlantic MR back-haul of 38,000t of gasoil US Gulf/UK Continent on a round voyage basis now pays shipowners more than the front-haul of 37,000t of gasoline UK Continent/US Atlantic Coast, prompting questions of the arrival of the long-expected reversal. US Gulf exports have been boosted by high US refinery utilisation (at 92%+), continued high cost of Renewable Identification Numbers (RINs) which make it costly to supply the product for domestic consumption and increasing supply from Venezuela following the restart of PDVSA`s 180,000 bpd crude unit at the 635,000 bpd Amuay refinery. In contrast high USAC gasoline stocks are curbing import demand, causing the back-haul to outstrip the front-haul. Whilst most believe US Gulf/UK Continent will eventually become the de facto front-haul, it may be a choppy ride getting there. Rising WTI prices may begin to curb US Gulf exports as refining margins are cut, whilst a recovering US economy will likely consume more product domestically for industry and manufacturing, with falling unemployment boosting gasoline imports, especially if the government intervenes in the costly RIN situation.
